Who REALLY Owns the Loan ?

With stories like this, we know that there are settlements, but we don’t know the terms. Just like the confidential settlements with homeowners that occur every day, we never hear the terms of settlement. The issue is whether the banks are being forced to either pay for the losses they created by writing bad loans or if they will be required to re-purchase the whole thing because the loans are, in the words of the investors, unenforceable.

If they are paying off the investors for the loss, and the loss is directly related to the bad underwriting on specific loans, then the payment has reduced the the amount receivable and identified who is to blame for this problem. If the banks are repurchasing the loans because they were bad, unenforceable loans, why are they being allowed to enforce loans that are admittedly unenforceable?

And if the investors are the lenders and the lenders are admitting against interest that the loans are bad and unenforceable how can anyone come to court and enforce the debt under the premise they are suing for the lenders and seeking the old balance?

In discovery, the homeowner should aggressively seek information regarding these settlements. It makes no sense to have the lender paid of in part or entirely and then to allow some intermediary to enforce it when the basis of the settlement was that the origination was bad and that the loans are not enforceable.

BlackRock, Pimco among those suing trust units of major banks over mortgages

  • The trustee units of Detusche Bank (DB), U.S. Bancorp (USB), Wells Fargo (WFC), HSBC, and Bank of New York Mellon (BK) face a lawsuit by an investor group led by BlackRock (BLK) and Pimco (and also including PRU and SCHW) over their role in overseeing and enforcing terms on more than 2K mortgage-backed bonds between 2004 and 2008.
  • The group is seeking damages for losses on the paper that have surpassed $250B, reports the WSJ. At issue, say the plaintiffs, is the banks breaching their duty to bondholders by failing to force the lenders and bond issuers to repurchase poorly underwritten loans.
  • A similar plaintiffs group has already won settlements from Bank of America and JPMorgan for their roles in originating and selling toxic mortgages.

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34 Responses

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  2. Who is Authorized to change the trustee in a securitized loan. US Bank National Association was the Trustee before we went into the Bankruptcy Process. Once the Bankruptcy proceedings started, Wells Fargo’s (Servicer)’s Attorneys created documents to appoint individuals within thier lawfirm as trustees. Im no attorney, but something just does not seem right about that. James 443 677 2799 jsmith5915@msn.com

  3. Subject: Join me in telling BofA to settle with America Bank of America is on the verge of agreeing to a settlement with the Department of Justice for their role in peddling toxic mortgages that led to the financial crisis. We need to ensure that relief from this settlement – rumored to be around $17 billion – actually gets to the people who have been hurt the most by Bank of America’s practices. Join me in telling Bank of America: It’s time to “settle with America” and agree to meet with families that they have victimized. We know that when the banks get a chance to meet families in person, it’s much harder to simply dismiss them. Let’s make sure BofA gets the message. http://www.commongoodaction.org/tell_bank_of_america_it_s_time_to_settle_with_america?sp_ref=51341981.122.8779.e.32740.2

  4. Slow Churned Home Grown Justice. Ironic n Poetic. If I refuse to take a nap is that resisting arrest? If I gag my husband and hog tie him, is that an illeagal restraint? Spell Chek. ?

  5. First let them make their claim. Then nail them lil peckers down. No Proof of Claim. Not in state or federal courts. They nail their own coffins closed. You still have to bury them thou . . Funerals are expensive these days. Make your claim known to the world.

  6. And if they are plaintiff- burden of proof is on them ( poetic justice)

  7. Neidermeyer that is why its worth blogging ( and why they don’t like it) and sharing, if what we share triggers something that might work in another’s case – research the heck out of it before throwing it away, it may be important. Turn every stone.

  8. @ Deb Wynn & MyCookieJars ,

    ****************** bears repeating *********************
    By definition ( hat tip to Aman) there are other parties recognized here by stating ” assigns and successors” now who in heck are these unknown ” assigns and successors” humm…I am requesting that I be allowed to joinder these ” assigns and successors”. Because – pay attention: therefore there may be parties with claims to have interest in the subject matter of the property- and so must be included in this litigation so that the rights may be determined completely and all rights determined in one litigation.

    Excellent … This works for me on so many levels ,, especially as I have 3rd parties with confirmed interests (albeit in the past but never documented ,,, and the disposition of those claims is also up in the air..)

  9. No answer. Wait til they file MSJ. Then jointer. They switcheroo’ ed the attornies after no answer, but no Request for hearing on SJ. The battle line is drawn. Ahhh the repeat crimes, they never learn. Jail? Risky Business? Sure it is. I have no use for liers or cheats, as you well know, I have no Tolerance for them either.

  10. No standing to invoke the jurisdiction of the court. Enforce the Contract. Many Blessings to All.

  11. State Laws Vary. Here is a mind boggler for you. Lien theory state. The mortgage is an encumb but there is no lien. Pissed Me Off.

  12. ….fir not playing by the rules!

  13. It’s ok cookie they are kicking their own butt.

  14. Deb, we are on the same page because we play by the rules. Go kick Butt!

  15. Cookie we just had synchronicity
    As you were writing I was writing and it kinda fits. I believe in that stuff. We are all connected universally. Don’t mean to sound spooky but I see it all the time. Consciousness of good serves- anything otherwise- never serves. Better get back to researching. Peace all.

  16. Deb that’s why sued me. A non borrower. Just Say No!

  17. Let me throw something out there – and be discerning because it may not fit others unique set of circumstances so hypothetically here goes : say there’s a trustee for a MBS trust in court to evict you and gain possession : the suit is filed on behalf of a trustee for another ” tristee” of a MBS alt a securitized trust AND it’s ” assigns and successors”
    By definition ( hat tip to Aman) there are other parties recognized here by stating ” assigns and successors” now who in heck are these unknown ” assigns and successors” humm…I am requesting that I be allowed to joinder these ” assigns and successors”. Because – pay attention: therefore there may be parties with claims to have interest in the subject matter of the property- and so must be included in this litigation so that the rights may be determined completely and all rights determined in one litigation.
    For Arizonians ( cross reference accordingly in other States) see rule 19a RCP for superior court and Rule 20a
    For permissive jointer. Case law – Larry d and Patricia k Ellermanv Steven E Snyder as trustee of the Steven E Snyder Living Trust
    And Mohave valley Irrigation and Drainage District V HCJM incorporated et al.

    Not legal advice just sharing info. Do your own research and consult with an attorney.

  18. The rights of parties are required to be clearly difined given the surety right to subrogation under a counter claim of defeasance transaction. Claimsheld for bonds issued by and under the corpus of private annuity trust established by a taxpayer corporation, in substance defeasance transaction is not permitted to enforce the call provision on a mortgage given to the borrower held outside the trust for a term o 30yrs. Trustee’s claims for attorney fees and costs are paid.

  19. Sadly I had to be embezzled out of my home before I learned how to get them for what they did.

  20. The Title should be. How many own the loan? Once the chain of title is broken Multiple entities own the loan.


  21. Thanks Gene
    I am impartial to every thing on here and I just read and then think about my experience with MY case. You appear knowledgable. I say appear because one thing I know with this game is it’s poker combined with chess if you catch my drift. I would never discount anyone’s opinion because we have made an effort writing on here so I take what I can and then think for myself you understand and I encourage others to do same. There’s no way as a registered nurse I can do this by not researching 24/7 and sticking to the strengths of what’s left of my very meritous case that should have been over years ago. Don’t stop posting its a good thing Gene.

  22. Deborah,

    Your comment must have been aimed at me, so here goes.

    Under a Fiduciary Duty argument, the Trustee would actually have to pay the Investors for the loans or losses. Then they can demand that the Depositor buy the loans back from them, through the Indemnity Agreement. If the Depositor no longer exists, then the Trustees are left on the hook.

    I deal with stuff like this every day and I am asked weekly to provide input on much of this stuff. What most people read about and speculate about on this website is completely wrong. They are promoting b.s. theories by people who are looking for any way to save their homes, or else to try and take advantage of others here.

    You want to fight servicers? Look to the loan modification practices and then defects in the foreclosure process. That is about the only arguments that will work.

    Want to argue that the loan never made it into the Trust? Start packing now to move out. That will be the result.

  23. The CA perspective –
    Moreover, Mason’s “vapor money” theory of relief—”the convoluted and
    nonsensical argument that a plaintiff does not owe the money advanced by the lender on [her] loan because the indebtedness was not funded by the lender with actual money” (Tonea v. Bank of America, N.A. (N.D.Ga. 2014) __ F.Supp.2d __ [2014 WL 1092348, *11])—has been roundly rejected by courts nationwide. (See Miner v. JPMorgan Chase Bank (N.D.Cal. 2013) 2013 WL 1089909, *3.)

    I find it fascinating how quickly the CA judiciary points to federal cases, which are not binding, to build up case law against homeowners, BECAUSE CALIFORNIA STATUTES DO NOT SUPPORT THEIR ABSURD CONCLUSIONS.

  24. Please anyone reading here first get those fundamentals re trustee of MBS go to sec website – they said it first so it’s best source
    Trustees distribute cash to beneficiaries they typically do not own real property they typically do not buy it they handle cash from pools of mortgage payments. Go to sec.gov/ answers mortgage securities
    Google it.

    Not an attorney . Just sharing info.

  25. NG,

    I am really beginning to wonder about your ability to understand the written word. What you write above is not what is going on with the PIMCO lawsuit.

    PIMCO, etc, filed the lawsuit on a violation of Fiduciary Duty issues. Primarily, the claim is that the Trustees failed to exercise their FD to the Investors by not demanding repurchase of defective loans for Reps and Warranties violations.

    Reps and Warranties violations do not mean that the loan is void, or the contract is void, nothing of the sort. It means that there are issues with potentially income or appraisal fraud, occupancy fraud, TILA/RESPA disclosure issues (minor infractions) and numerous other items. These do not void the loan.

    Successful prosecution would mean that the Trustees would buy the loans back at full face value minus payments made (to be worked out by a court) or else pay losses on loans which had been terminated, whether through short sale or foreclosure. If the loans were bought back, then there are no realized losses until a completed foreclosure, etc, occurs.

    FYI, the Trustees did not enforce the Reps and Warranties because they themselves issued loans through securitization with other named Trustees, so if one Trustee made repurchase demands against a lender, another Trustee could do the same against them.

    Now, if the Trustee loses and has to pay, the Trustee Agreement actually requires that the lender reimburse the Trustee. So the Trustees would not be harmed…………except in the case that the lenders are no longer in business. In that case, the Trustee is on the hook.

    (BTW, I use lender to mean the Depositor. And as we know, many Depositors are out of business.)

    There are some major issues with the case. Just a few of them:

    1. Does the Fiduciary Duty have a Statute of Limitations and if so, for how long?

    2. Reps and Warranties had a set period of time for action. Can PIMCO get around this problem without FD claims?

    3. Why did the Investors take so long to file the lawsuit?

    As for NG, if his arguments about the loans never going into the Trust are so great, why didn’t PIMCO claim that? Of course, maybe their attorneys are not just as smart as NG.

    There are actually arguments that could be made which would be much stronger and would not focus upon Reps and Warranties. Those remain in “waiting”.

    This is simply an extortion action by PIMCO and others to obtain a settlement for a small portion of the claims. It is highly unlikely that anything else would occur.

  26. BOA near a 13 to 17 billion dollar settlement? They netted that on sales of just a minuscule portion of their MBS sales. Atrocious once again. Who elected/appointed/ hired the imbecilic dirt bags who come up with these hilarious “settlement” amounts?

  27. BOA maintains there was no harm to the victims. I would like them to define harm and what dictionary they use, a Bankster Dictionary where extortion causes no harm? What about theft? Borrowing were we? Unjust enrichment in my book is called profit. What about the health and well being of those victims? No harm? I didn’t blame BOA for CW fraud. But I sure in tarnations hold them to the Fire for their own actions!

  28. http://www.bloomberg.com/news/2014-07-30/bank-of-america-s-countrywide-ordered-to-pay-1-3-billion.html

    Bank of America’s Countrywide Ordered to Pay $1.3 Billion
    By Patricia Hurtado Jul 30, 2014 2:39 PM ET
    – Comments Email Print



    Bank of America Corp.’s Countrywide unit was ordered to pay $1.3 billion in penalties for defective mortgage loans sold to Fannie Mae and Freddie Mac in the run-up to the 2008 financial crisis, a little more than half of what the federal government had requested.

    U.S. District Judge Jed Rakoff in Manhattan issued the civil penalty against the Charlotte, North Carolina-based bank today in the first mortgage-fraud case brought by the federal government to go to trial.

    Countrywide and Rebecca Mairone, a former executive with the mortgage lender, were found liable by a jury in Manhattan federal court in October for selling thousands of bad loans to the two government-sponsored enterprises. Mairone was ordered to pay $1 million.

    While Rakoff didn’t grant the government’s request for the maximum penalty of $2.1 billion, he concluded that Fannie and Freddie paid Countrywide nearly $3 billion for the HSSL loans. The judge reduced the penalty by 43 percent because experts for both sides said more than 57 percent of the loans were of “acceptable quality.”
    Settlement Talks

    Separately, Bank of America is nearing a settlement with the Justice Department after raising its proposed offer to resolve probes into its sale of mortgage-backed bonds, according to people familiar with the talks. Representatives of the bank were at the Justice Department today to discuss the terms, and an accord could be reached this week, said two people who asked not to be named because the negotiations are confidential. The amount of the settlement under discussion has ranged from $13 billion to $17 billion, one of the people said. The discussions include how much money will be paid in cash and how much in consumer relief.

  29. When they defaulted borrowers who were current and forced them to defend themselves… It pissed me off! And when the gov set on their hands and let the banks rob us blind as investers, taxpayers n home owners… It pissed me off! Scratched National City, Citi, Ocwen USBank, B0A and one of my Friends got to Chase before me. I live by the Golden Rule, don’t piss me off.

  30. My daughter bought one of those REOs. She was preapproved for a much larger FHA loan months earlier. She ultimatly decided on this repo, needed lots of TLC so it didn’t qualify FHA. They told her at closing and did the switcheroo to a conventional with much less favorable terms such as PMI of almost $300 a month. Pissed Me Off! Yep! During discovery after ocwen denied rescission and filed fc we found out this 1st time homebuyer had a bad title, a very large FHA loan in her name that she never took and a conventional loan. She doesn’t want the house or the dirty money. She wants her credit cleared and legal fees. Unreasonable? Somebody thinks so. Spent 8yrs using taxpayer n investor money (my money n your money). Legal Fees exceed the $82,000 loan. Why would they do that? On another issue, why would they put current borrowers in default?

  31. As for ” seeking the old balance” that’s what debt collectors do. And there’s a whole lotta “yes buts ” around that when it’s unsecured.

  32. So it’s breach of contract Neil ? Who breached first ? House of cards came falling down when investors stopped purchasing the banks knew this would happen they hedged their bets, even against their own customers. They belong in jail.

  33. As it stands the courts are forcing the weaker party to do all the leg work just surviving their 12b6 motion to dismiss has been disastrous for most who tried to have their voice heard, and as for ” deb get an attorney” – I did, twice each had a year of my money my dedication and I get thrown under the bus my friends- the last failed to respond to that motion to dismiss but replied ” yes but ” and referred to the consent orders 2011, a yes but will not impress any judge, but there ya go, the thing is golden rule- always answer a motion to dismiss and the other word is with PARTICULARITY – state a claim under which relief can be granted , not easy when they hold all the forged counterfeit documents accepted as true- and recorded in the land records, they are not, true. I picked up my case in tatters and survived under 60b and other issues of due process. personally getting even close to discovery has been a chess game of five years. They are checkmated though the rest is up to the judges – the all powerful.
    Now as a consequence to all of the above and more we have someone living in my former home who never had right to possession, ( and clouded title but that completely separate argument) so I encourage you to click on link below, this is the 3 headed monster growing more heads each day that this crime has created. This is what greed does.


    Sent from iPhone
    Deborah J Wynn

    Its not whether you win or loose
    But how you play the game.

    Not an attorney just pro se sharing on a blog site. Please consult a attorney and definitely do thorough research thereto and do your own legal research too.

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